What does money teach us about importance?

$1 Trillion for Health Reform and only $15 Billion for Jobs?


When Scott Brown became the first Republican Senator elected in Massachusetts for decades the political earth shook.  This seat was held by Ted Kennedy who made it his mission to see health reform passed into law.  The Democrats reaction was a realization that their priority of health reform was not apparently the priority in the public.  Polls seemed to bear this out showing health reform second or third on the list.  The Democrats regrouped and said from that point on the priority would be jobs, jobs, jobs.

The Democrats in the House today voted for a $15 billion jobs creation package in a 217-201 vote.  That is approximately 1% of the amount to be spent health reform and 2% of the cost of the bank bailouts.  This is a commitment to jobs?

Further, this bill in the House barely sqeaked by in a 217-201 vote.  Call me crazy but that vote margin does not impress and leave an impression that job creation is really a priority.  The less than zealous focus on jobs by Democrats was again shown when the Senate voted down Scott Brown's amendment to cut payroll taxes by by $80 billion with unallocated TARP money to spur the economy and job growth.  This after Brown reached out to Democrats by supporting their job bill.  Were the tax cuts approved, this and the jobs bill would still be only about 13% that spent on bailing out banks.


There is little evidence of bipartisanship in the House and Senate even on the public's top concern of job creation.  Scott Brown's amendment may well have been voted down because he is a Republican, and in the slash and burn politics in DC, you must destroy the other party no matter the impact on the country.  In this case Democrats won by defeating the amendment, and we all lost because even less money will be devoted to jobs creation.  Worse still is the fact that the Democrats jobs bill used to be about $80 billion AND bipartisan in the Senate until Harry Reid unilaterally tossed the agreement for a puny $15 billion bill instead.  And they say Washington is broken and tone deaf to the voters.

And now we are right back at health reform.  The Democrats epiphany about jobs lasted all of about 4 weeks before they went right back to health reform trying to use the reconciliation process the pass the unpopular bill.

Thanks to PoliticalCentrist.com for this article.

Dennis Kucinich

This guy is a complete genius.  He had the audacity to go on TV today and state his plan for creating job growth.  Now get this, his plan is to lower the age for early Social Security retirement so that old people can leave their jobs earlier thereby creating openings that can be filled by younger people currently out of work.  

So, once again another career politician comes up with a solution to a problem that will both not solve the problem but have various other negative impacts.  Lets discuss:

First, and in my estimation most concerning, is the issue of adding more people to the rolls of Social Security that will be draining this insovent fund for an even longer period of time.  Just another example of short-sighted leadership from a career politician.  We should at least require an online MBA for these guys, but that would likely require that we review that standard as well.

Second, this plan does not help witht he creation of any new jobs.  It merely shuffles the deck, no net gains whatsoever.  This plan basically states that if your unemployment percentage starts to run high, jsut take workers out of the mix.  Perhaps if too few people vounteer for the program, he can suggest another method of culling the mass of working aged persons.  I hope the "permanent solution" does not occur to him. 

Third, what about the cost to companies?  I know that many of these faceless evil corporations have the temerity to turn a profit while so many "average" americans are suffering, but lets follow this to the logical conclusion.  How many of these aged retirees will actually be replaced?  Just as likely as replacing the departing personnel is the retirement of the position.  If they are replaced, how much will it cost these companies to train the incomming  personnel? (this is money that will be written-off at tax time)

Given more time I could likely come up with more.  But gee wiz, I only put an hour of thought into this so far.  I am not so smart a guy that I can outthink a congressman's entire staff, but I have done so yet again.  I expect that there will be a ton of bloggers and editorials on this.  However, I doubt a plan like this will ever see itself voted on by the general assembly.  I am just staggered by how obtuse our elected officials are.

I think it is time that we stop blaming the elected officials and just start back-handing each and every voter.

Obama is tackling healthcare... still?

Obama is having a "bipartisan" meeting to discuss healthcare reform on Feb. 25.  This is great!  Now instead of barring Republicans from the meeting altogether, he is going to have them right there in the room so that they can be ignored. 

Republicans have made it very clear that they have heard the people and will not support a federal take-over of healthcare.  This means that the entire legislative process needs to be restarted.  Obama still thinks that he can bribe Republicans enough to get them to sign onto this rediculous plan.  There is really no solution that will work in the long run because the fundamentals are the problem.  Neither the Democrat (Progressive) nor the currently recommended Republican plans for changing the system will work to fix the insolvency issue that is our current entitlement fiasco.

The fundamental issues are that as life-expectancy has increased, the retirement age has not and too many people have no "skin in the game" concerning medical costs.  This means that programs like Social Security, Medicare, and Medicaid are eternally doomed. 

Look at Paul Ryan's "Roadmap for America's Future" lifted in part from here:

Medicare and Social Security would be preserved for those currently receiving benefits, or becoming eligible in the next 10 years (those 55 and older today). Both programs would be made permanently solvent.

Universal access to affordable health care would be guaranteed by refundable tax credits ($2,300 for individuals, $5,700 for families) for purchasing portable coverage in any state. As persons under 55 became Medicare eligible, they would receive payments averaging $11,000 a year, indexed to inflation and pegged to income, with low-income people receiving more support.

Ryan's plan would fund medical savings accounts from which low-income people would pay minor out-of-pocket medical expenses. All Americans, regardless of income, would be allowed to establish MSAs -- tax-preferred accounts for paying such expenses.

Ryan's plan would allow workers under 55 the choice of investing more than one-third of their current Social Security taxes in personal retirement accounts similar to the Thrift Savings Plan long available to, and immensely popular with, federal employees. This investment would be inheritable property, guaranteeing that individuals will never lose the ability to dispose every dollar they put into these accounts.

Ryan would raise the retirement age. If, when Congress created Social Security in 1935, it had indexed the retirement age (then 65) to life expectancy, today the age would be in the mid-70s. The system was never intended to do what it is doing -- subsidizing retirements that extend from one-third to one-half of retirees' adult lives.

Look at these common sense solutions, then look at the quagmire that is the 2,000 page Progressive solution to healthcare.  Tell me which one makes sense for both current and future stability.

AIG Bonuses

There is a lot of talk about the AIG bonuses that are now being paid for the second year in a row.  The 100 million is a very large sum of money to come from an organization that would not even exist if not for a public bailout.  I understand the anger, but what do you expect? 

The AG for Connecticut was on the Kudlow Report last night talking about these bonuses and about his attempts to get them back.  Where was he when the bailout was occurring?  Where was the Fed making sure that bonuses were discontinued at the inception of the bailout?  Perhaps they did not know that AIG gives bonuses.  Perhaps they did.  This is the classic stance of governmental bureaucrats.  They stick their heads in the sand until a calamity happens.  They were warned about the looming mortgage crises (that they created), and did nothing.  Barney Frank and many other Democrats actually opposed legislation introduced in 2000, 2003, and 2004 that could have seriously mitigated the meltdown saying that worries about Fannie and Freddie were "overblown." 

Clinton: I think the responsibility that the Democrats have may rest more in resisting any efforts by Republicans in the Congress or by me when I was President to put some standards and tighten up a little on Fannie Mae and Freddie Mac.

Why would you assume that someone who takes enormous risks, gets in trouble, gets bailed out with "no strings attached"; would learn a lesson?  Depository banks traditionally operate in a low-risk environment.  It is exactly that type of environment that makes a depositor feel safe.  However, investment "banks" (you should really use the work financial institutions) operate in a high-risk environment.  This is precisely the environment people turn to in "up" times to get the most return for their money.  When you reward this high-risk behavior with bailouts, you prove to these managers that their taking risks can have huge rewards with only minimal downsides.  What are we trying to teach here?  It flys directly in the face of the constitution to void these bonus contracts.

The financial institutions have been rewarding their employees the same way for well over 20 years, they have been preying on the upper and middle class for decades before that.  Why would the government think that these zebras would change their stripes now?  The government did nothing to stop these bonuses when they crafted TARP.  I don't understand why they act so indignant now.  If they had wanted these contracts broken, they should have done so as a condition of TARP funding.  They also could have provided back-stop funding for a managed restructuring of debt and all other contractual obligations (bankruptcy).  That option would have been the best for the American people since it would have allowed us to buy into these corporations much more cheaply.  The government chose to forgo these options.  It is a little more than a bit disingenuous to complain about things now.

I can guarantee you that the same people that the government "hopes" has learned their lesson have not.  More importantly, what I am hoping is that "we the people" have learned how our "protectors" play their games (and games they are).  There is not much more than CYA (cover your a$$) going on in politics.  As long as we have a culture that punishes the self-sufficient, independent man and rewards the selfish lay-about; we will have no shot whatsoever at becoming the great country that the US was intended to be.

Why did Republicans flip?

The President's biggest talking point these days is the Republicans' flip on the bi-partisan budget commission.  Now, I think this is a great talking point.  However, his talking points skip the fact that there are often major changes in a bill between its inception and the vote on its passage.  Lets look at the reasons for this "flip."

1.  Congressional votes on the proposals issued by the commission would be cast before new members of Congress elected in November are seated.  This would, unfortunately, allow disposed members to affect law that the voters will likely not want.

2.  No outside sources can be used to obtain estimates contrary to the finding of the commission.  WHAT!!!  Huge red flag.

3.  Limited chance for opposing views to be presented.  Meaning only the commissions findings would even be available for a vote.

Given these 3, I would rather think that the "flip" was the responsible thing to do.

Judd Gregg Kicks Some Ass

I came across this today and am ecstatic that someone GETS IT.  There is no way I could have said it better mayself.  In fact I said it much worse last night.

Ummmmm... Spending Freeze?

I have not been able to get my head around this spending freeze that has been proposed.  I just got a terrible feeling while watching CNBC.  They were talking about the big rises in the programs that are about to be frozen.  Wow.  What would be the best way to get guaranteed spending on programs you want to funnel more money to over the next few years when you know you are likely to lose control of Congress? 

They don't have 60 votes to get some of their efforts through, but the nuclear option can be used for budgetary matters and this is nothing if not a budgetary matter.  With only 51 votes needed to push this huge pile of garbage through the Senate, the administration can lay the groundwork for the next 3 years of bloated spending.

Just a thought from a very tired guy.

Obama on YouTube

I wish I could say that it was super interesting and informative, but it was only moderately so. He noted a few items of interest. Amongst those are Healthcare, student loan repayment, net neutrality, education, terrorism, and energy. See the full video here.

Healthcare - nothing new here, he still wants the government to run it.

Student loan repayment - nothing new here either. I am still struck by his thinking on this one though. Why would you let the debt expire for someone making (on average) 40k/yr after 20 years, but let someone making (on average) 70k/yr have theirs forgiven after only 10 years? The incongruity here is staggering. For that matter, why would you forgive any of this debt at all? God knows I am still paying my student loans. Instead of seeing them as a burden that I can foist off on others, I see them as the price I pay for access to the quality of life I enjoy. It is a slippery path you start down when you view your quality of life as being the responsibility of others.

Net Neutrality - wow, this is truly a can-of-worms. Please take the time to educate yourself on this point. I do not want to spoon feed anyone on this. My opinion on it - VERY BAD.

Higher Education - makes you a better citizen. Ouch.

Terrorism - I am actually pretty in-line with Obama's approach on this. I agree with each strategic decision he has made given where he found himself. I still regret going into Iraq under the pretenses that we did. Not that it did not need to be done, but we needed more concrete proof and justification for what we did there.

Energy - We are pretty much on the same page here. I advocate truly "clean" energy based on its proven ability to lower pollutants in the atmosphere. I do not endorse his indefensible opinion on climate change. We just have two separate roads to the same conclusion.

High Speed Rail to be announced tomorrow

President Obama and VP Biden will be in Tampa to announce grants (already announced a year ago in the Stimulus package) for high-speed rail. There is virtual certainty that a line connecting Tampa and Orlando will be approved as well as a line from Sacramento to San Diego.

The Stimulus plan set aside 8 billion in funds for 13 high speed rail projects. The plan is to create or save "tens of thousands" of jobs. The is a warning included that these jobs will not come about quickly especially when you factor in the fact that there are currently nearly no firms in the US that are involved in high-speed rail planning, production, or building. Given this, many foreign firms are more excited about this news than we should be domestically.

I would like to give a shout-out to the administration for taking the time to come on down to Tampa to announce something that was part of a bill from a year ago as if it is current news.

Government to FREEZE the budget.

The administration has announced a plan to freeze the budget for 3 years.  This will not affect military or security budgets.  It is expected to save 250 billion over the next 10 years. 

Only our government will project the cost/savings of a program designed to run for 3 years over a 10 year period.  I am not saying I agree or disagree with the move.  I am just asking why the government would buy a piece of chewing gum and project its cost over a 10-year period.

Is it too much to ask for a little balance here?  Eric Holder is going after lenders that used "predatory practices" to lure people into mortgages that were not advantageous to them.  What is the difference between what those guys did and what the government does to the general public every day? 

Using accounting tricks to try to pass Demacare, lying about the stimulus, and now the budget freeze.  Just man-up and give us some straight facts.

How has the Stimulus really helped?

I know there are stories in the hundreds and even thousands of how the Stimulus has helped individual people.  I am very glad that those people, who desperately need help, are receiving it.  However, what I cannot get my head around is how the government is presenting the data in a format that shows that each job saved is costing us much as five hundred thousand dollars. 

Now this is just me being a pessimist and taking free shots at our nation's progressive welfare agenda, but I don't see how giving someone a temporary job that pays 30-50k (although I rather inflated this number to sound a little less condescending) and that only stays in place for as long as government intervention in the market continues at a cost of the times more than the job is "worth" really helps.  The number of jobs saved when compared with unemployment overall is barely significant.  I am not saying that a program that creates or saves permanent jobs is not a good program, but I have yet to see anyone talk about permanent job creation.  Why is this?

The types of jobs created by artificially stimulating the economy can never be permanent.  When the funding that created (or saved) the job goes away, then so does the job.  This does not even take into account the fact that many of these alleged "saved" jobs that have been falsely claimed. 

The moneys given to many organizations are actually used to buy computers or give raises to current employees.  Couple this with the reported reluctance and refusal of many companies to share information with the media about where the stimulus money actually goes, and you are led to the conclusion that the Stimulus program is likely suffering from more fraud and abuse than Medicare/Medicaid.  Along those same lines, do you know where your cash-for-clunkers money ended up?  A good portion of it went to purchase fuel efficient cars that were traded-in within a week for cars that were less eco-friendly than the cars they replaced.  I am not joking; there was one car lot in Florida that actually advertised this program!

Simply that we are spending ten dollars for each dollar that goes to someone's salary is insane.  Would it not be more efficient to give that person two dollars for each dollar they are receiving right now?  Even that would save the tax-paying populace of this nation 80%.  Is it any wonder that our government is facing huge deficits?

When will our government learn that their welfare (socialist) programs will always be abused?

As stimulus fades, economies will face an up-hill battle

From AP:

SHANGHAI - The global economy will suffer the fallout from the financial crisis for years to come, the World Bank said Thursday in a report warning that growth may wilt later this year as stimulus spending fades.

There is optimism that we will se some economic growth this year, but no guarantees.  As the credit crisis gathers steam and home forclosure continuing, there is plenty of concrete bad news to go along with any uplifting forecasts we get.  Banks are not loosening the purse strings on lending and are following a government mandated forclosure policy, and neither of these are good portents of things to come.